How To Transfer Stocks To RRSPs or TFSAs

Let’s say you’re bored one day, and you’re looking to transfer stocks, maybe to your RRSP or TFSA. You have literally done everything else that’s humanly possible, including watching an episode of Honey Boo Boo, the worst show in the history of the world. YOU NEED SUBTITLES TO FIGURE OUT WHAT THE HELL THEY’RE SAYING. Although I’ll give Mom props for saving the money they’re getting from the show. It still won’t help you gain the IQ points you lost from watching, but still. Well done, Mama Boo Boo.

Sometimes you’re going to need to transfer a security into your RRSP or your TFSA. Maybe you have no money to make a contribution, but you’d still like the tax deduction for making that RRSP contribution. Or maybe you’d like to put a dividend stock into your TFSA because you’re looking for tax free income. It’s generally a good idea to hold bonds in your RRSP, (since they pay interest, which is fully taxable) so maybe you’re looking to save a little tax that way. Or, again, maybe you’re super bored, and have no hobbies or friends, and this is your idea of fun. Geez, it sucks to be you, Mr. No Friends.

Alright. Let’s show you kids how you actually do this transfer. Cause it’s pretty easy.

You pick up the phone, and call the nice folks at the customer service. You tell them you want to transfer stocks to your RRSP, and they take care of it for you.

And that’s how easy it is. Fell free to pick up your jaw from the floor, because I just blew your mind a little bit.

Fortunately for the (sexy) guy writing this post, it’s not quite that simple. Let’s talk a little bit about what happens during this transfer.

First, let’s go over what happens if you’re sitting on a gain. When you transfer the stock to your RRSP, you trigger a sale. As far as the government is concerned, it’s just like selling the stock. You’ll owe capital gains tax on any gain you’ve now made official. Be sure to plan for this, especially if you’re transferring a real winner.

What happens if you transfer a stock you’ve lost money on? Would you get a tax loss exemption? Yeah, no. The government is kinda mean like that. If you’re looking to transfer a stock that’s currently underwater, you need to sell it first, and then transfer the cash into the corresponding account. You also have to wait a month before buying the same stock back, or else the taxman doesn’t consider it a wash sale.

If you want to minimize the tax issue when doing this, the strategy is pretty simple. Just find a stock that’s up and a stock that’s down about the same amount, transfer the winner and sell the loser, and the taxes will pretty much cancel each other out.

And that’s about it. Pretty simple, right?

While we’re on the transferring topic, let’s take a quick look at transferring from one brokerage to another. I’d obviously recommend you go right now and transfer all your assets to Questrade. Keep in mind I may be slightly biased.

There will be a part where they ask you about your current broker. You just tell them that you want to transfer the existing account, give them the account details, and they’ll take care of it. There’s no awkward phone call, no weird “it’s me, not you” conversations, or anything remotely uncomfortable. They’ll take care of you like I take care of all my internet girlfriends’ needs. I am a through lover who has spent a lot of time Googling dirty things.

Your current brokerage will charge you a fee to move, because they are big fat jerks and that’s why you’re leaving them forever. (They all will charge you to leave. They get mad when you leave them. Hey, they’re lonely.) Most of the time your new broker will just automatically reimburse those fees, without you even asking. It’s worth an email to customer service before you get the process started though, just in case. But it shouldn’t be a problem.

And that’s about it. Remember, these guys want your money. They’re going to make the transfer process easy. And now you know all about it. Go celebrate with some red meat and a hooker.